Collaborative Water Risk Management: Guidelines for the Power Industry, Water Utility, and Regulator

Abstract

Safe and adequate access to energy and water, the two natural resources driving the production of all other critical human needs, is key to economic development, public health, and military security. The availability of these two resources is threatened by the increase in demand and competing interests for their supply. Water resources are critical to energy production while energy resources are necessary for safe deployment and allocation of water. The constraints imposed by such reliance are evident in the thermoelectric and water supply industries, which must procure water to ensure operation while complying with water quantity and quality regulations. Thermoelectric plants are responsible for almost 90% of the generation capacity and 41% of the freshwater withdrawals in the United States (Kenny, et al. 2009). Water suppliers are responsible for 13% of freshwater withdrawals while 75% of a municipalities cost to process and distribute water is spent on electricity (Sandia National Laboratory 2006). This study discusses the current framework and pricing structure under which a power and water utility operate and focuses on the relationship between these utilities, in order to identify collaborative strategies that ease dependence on both resources. The research identifies the main roadblocks to effective management including impeded flow of information, inaccurate pricing models, and increasing stress to water resources. To address the aforementioned roadblocks, five recommendations are presented with case studies serving as reference points. This guideline proposes the implementation of accurate price signals, demand response measures, collaborative efficiency programs, alternative water sources, and alternative energy sources to ease water constraints. Recommendations are the result of extensive literature and data review, as well as interviews conducted with utilities, agencies, laboratories, research centers, and technology providers.